My mortgage options only owned for 1 year

Atechnician

Thanks for food for thought.

Is it best to hold off on overpayments until I'm on a lower interest rate?

getmore4less

the sooner you pay the more interest you save and the better your LTV gets which leads to lower rates.

Atechnician

I've been doing some research on my mortgage I went on a price comparison and got offered a 1.69% fixed mortgage and I'm currently on 4.29% fixed and will cost me £4475.74 to leave my current bank early and I'm due for renewel December this year is it worth switching yet or wait till it's due?

mark55man

seriously - just do a spreadsheet or find one on line - plenty have two mortgage comparisons

loveyourmoney

Overpay! Overpay! Overpay!

Atechnician

I have already done a price comparison I was asking if it's worth paying the 4.4k early exit fee to join a lower interest bank? I'm planning to over pay aswell

getmore4less

to compare the deals

http://www.whatsthecost.com/mortgage.aspx

add the fees
set to interest only and your planned payment.

see how much mortgage is left at the date any ERC stop

if it is less than what your current deal will leave you it's worth switching.

getmore4less

you have 1 year to get your fees back

£154k £760pm 4.4k fee

£154,000 4.29% £151,437
£158,400 1.69% £151,906

£460 loss with exact details and probably only 10/11 payments you needs a lower rate to make this work.

mark55man

roughly if you have £150K mortgage 1% for a year costs £1500. Therefore if you need to save £4400 you need an interest rate 3% less

My view grin and bear it for the next 12 months, but be ready to switch day+1 you can.

Inflation is edging up but the economy is still so uncertain that I cant see interest rates creeping up for a while, certainly not so much that you wont still get a cracking deal at the time - I would consider a 2% for 5 years as the best of cheap and safe, however others who have gone for a succession of lower shorter deals have done better - so your choice - it seems you are not cash strapped, and have no real commitments so maybe you can run the risk of a sequence of short deals as long as the costs dont eat up your savings - then if your circumstances change (job children ...) you can change strategy - you mustnt pay too much for security (esp if you dont need it)